With a 13 per cent share, the textile sector is a major contributor to India’s export earnings. However, the sector has been under pressure of late. While, apparel exports having grown at a subdued pace due to intense competiton, yarn exports have also remained under pressure given the decline in demand from China as well as the country’s losing share in the Chinese yarn market.

Adequate budgetary allocation for schemes such as refund of state levies and interest subvention benefits can help improve the competitiveness of textile exporters and improve textile export growth. India is still highly reliant on textile intermediaries for its export earnings, indicating the potential for further value-addition and hence investment requirements in downstream segments, like apparel and home textiles.

A higher budgetary allocation towards the Technology Upgrade Fund Scheme subsidy for 2018-19 would prop up investments in downstream segments, facilitating higher value addition and an even higher contribution by the sector to the country’s GDP as well as forex earnings.

Apparel exports can go up if raw materials and intermediaries currently being exported get processed further into apparel. This has the potential to double cotton-based apparel exports and increase total textile exports from the country by 50 per cent in value terms.